ARTICLE 3. By-laws [13240. - 13251.]

Cal. Corporations Code - CORP 3.
in effect

Cal. Corporations Code - CORP § 13240. Section 13240.

Each association shall within 30 days after its incorporation, adopt for its government and management, a code of by-laws, not inconsistent with this part. A majority vote of the members or shares of stock issued and outstanding and entitled to vote, or the written assent of a majority of the members or of stockholders representing a majority of all the shares of stock issued and outstanding and entitled to vote, is necessary to adopt such by-laws and is effectual to repeal or amend any by-laws, or to adopt additional by-laws. The power to repeal and amend the by-laws, and adopt new by-laws, may, by a similar vote, or similar written assent, be delegated to the board of directors, which authority may, by a similar vote, or similar written assent, be revoked.

Cal. Corporations Code - CORP § 13241. Section 13241.

The by-laws shall prohibit the transfer of the common stock or membership certificates of the associations to persons not engaged in the production of the products handled by the association.

Cal. Corporations Code - CORP § 13242. Section 13242.

The by-laws may provide: (a) The number of members constituting a quorum. (b) The right of members to vote by proxy or by mail or both, and the conditions, manner, form and effects of such votes; the right of members to cumulate their votes and the prohibition, if desired, of cumulative voting. (c) The number of directors constituting a quorum. (d) The qualifications, compensation and duties and term of office of directors and officers and the time of their election. (e) Penalties for violations of the by-laws.

Cal. Corporations Code - CORP § 13243. Section 13243.

The by-laws may provide: (a) The amount of entrance, organization and membership fees, if any; the manner and method of collection of the same; and the purposes for which they may be used. (b) The amount which each member shall be required to pay annually, or from time to time, if at all, to carry on the business of the association; the charge, if any, to be paid by each member for services rendered by the association to him and the time of payment and the manner of collection; and the marketing contract between the association and its members which every member may be required to sign. (c) The amount of any dividends which may be declared on the stock or membership capital, which dividends shall not exceed 8 percent per annum and which dividends shall be in the nature of interest and shall not affect the nonprofit character of any association organized hereunder.

Cal. Corporations Code - CORP § 13244. Section 13244.

The by-laws may provide: (a) The number and qualification of members of the association and the conditions precedent to membership or ownership of common stock. (b) The method, time and manner of permitting members to withdraw or the holders of common stock to transfer their stock. (c) The manner of assignment and transfer of the interest of members and of the shares of common stock. (d) The conditions upon which and time when membership of any member shall cease. (e) For the automatic suspension of the rights of a member when he ceases to be eligible to membership in the association; and the mode, manner and effect of the expulsion of a member. (f) The manner of determining the value of a member’s interest and provision for its purchase by the association upon the death or withdrawal of a member or upon the expulsion of a member or forfeiture of his membership, or at the option of the association, the purchase at a price fixed by conclusive appraisal by the board of directors; and the conditions and terms for the repurchase by the corporation from its stockholders of their stock upon their disqualification as stockholders.

Cal. Corporations Code - CORP § 13246. Section 13246.

The by-laws may provide that the territory in which the association has members shall be divided into districts and that directors shall be elected from the several districts. In such case, the by-laws shall specify the number of directors to be elected by each district, the manner and method of reapportioning the directors and of redistricting the territory covered by the association.

Cal. Corporations Code - CORP § 13247. Section 13247.

The by-laws may provide that the territory in which the association has members shall be divided into districts, and that the directors shall be elected by representatives or advisers, who themselves have been elected by the members from the several territorial districts. In such case, the by-laws shall specify the number of representatives or advisers to be elected by each district, the manner and method of reapportioning the representatives or advisers and of redistricting the territory covered by the association.

Cal. Corporations Code - CORP § 13248. Section 13248.

The by-laws may provide that primary elections shall be held to nominate directors. Where the by-laws provide that the territory in which the association has members shall be divided into districts, the by-laws may also provide that the results of the primary elections in the various districts shall be final and shall be ratified at the annual meeting of the association.

Cal. Corporations Code - CORP § 13249. Section 13249.

The by-laws may provide that one or more directors may be nominated by any public official or commission or by the other directors selected by the members. Such directors shall represent primarily the interest of the general public in such associations. The directors so nominated need not be members of the association, but shall have the same powers and rights as other directors. Such directors shall not number more than one-fifth of the entire number of directors.

Cal. Corporations Code - CORP § 13250. Section 13250.

The by-laws may provide that directors shall be elected for terms of from one to five years; provided, that at each annual election the same fraction of the total number of directors shall be elected as one year bears to the number of years of the term of office.

Cal. Corporations Code - CORP § 13251. Section 13251.

The by-laws may provide for an executive committee and may allot to such committee all the functions and powers of the board of directors, subject to the general direction and control of the board.
Source: CA Legislative Counsel Bulk DataURL: https://downloads.leginfo.legislature.ca.gov/pubinfo_2025.zipFetched: 6/27/2026

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